The National Environmental Policy Act (NEPA), enacted Jan. 1, 1970, requires federal agencies to consider the environmental effects of “any major project — federal, state, or local — that involves federal funding, work performed by the federal government, or permits issued by a federal agency” (Wiki). NEPA also established the White House Council on Environmental Quality (CEQ), which issues guidelines to federal agencies for proper preparation of environmental impact analyses.

On December 14, 2014, CEQ published a Draft Guidance on NEPA review of project-related greenhouse gas emissions and climate change effects. Today (Mar. 25, 2015) is the deadline for submitting comments on the Guidance. On behalf of the Competitive Enterprise Institute, 14 other pro-market organizations, and one university professor, I submitted a joint comment letter critiquing CEQ’s proposal.

In brief, we argue that:

NEPA review is an inappropriate framework for making climate policy.

Project-related greenhouse gas emissions should not be a factor determining whether agencies grant or deny permits for individual projects.

Requiring agencies to consider project-related greenhouse gas emissions will make the pointless sturm und drang over the Keystone XL Pipeline the ‘new normal’ in NEPA review, further empowering NIMBY and anti-energy activists to block development projects with immense economic benefits and immeasurably small, hypothetical climate effects.

The Guidance will feed the hubris of those who believe government exists to bankrupt businesses and industries they dislike.

CEQ should withdraw the Guidance.

The joint comment letter is rather long and wonky but has a two-page summary highlighting key points. To read it in full, click here.

Nonetheless, no jurist–no matter how brilliant–can cure EPA’s Clean Power Plan of its legal infirmities. So when Professor Revesz testified in support of the rule a week ago before the House Energy and Commerce Committee, he was necessarily in a bind because he had to try to defend the indefensible.

In this post, my purpose is to respectfully rebut one of Professor Revesz’s most consequential claims made during his testimony. The claim at issue regards the ongoing debate over whether the plain terms of the Clean Air Act forbids EPA from promulgating the Clean Power Plan.

Background: The Clean Power Plan is authorized by Clean Air Act Section 111(d). Section 111(d) is unusual because the House and the Senate passed arguably different versions of the provision in 1990 Amendments to the Clean Air Act. Both versions are variations of what is referred to as the “Section 112 Exclusion.” According to the House’s version, EPA is prohibited from promulgating Section 111(d) regulations for source categories already subject to regulations pursuant to Section 112 (which establishes a program to reduce emissions of hazardous air pollutants). By contrast, the Senate version arguably prohibits EPA from issuing Section 111(d) standards for pollutants already subject to regulation pursuant to Section 112.

The difference between the two versions is crucial for the fate of EPA’s Clean Power Plan. Under the House version, EPA would be prohibited from promulgating the Clean Power Plan, because the agency already has subjected power plants to Section 112 standards. However, under the Senate version, EPA would be permitted to issue 111(d) standards for power plants (i.e., the Clean Power Plan), because greenhouse gas emissions from power plants are not subject to Section 112.

Of course, opponents of the Clean Power Plan argue that the House version of the “Section 112 exclusion” is correct; proponents of the regulation argue that the Senate version is correct. (N.B. There is a convincing case, made by the West Virginia Attorney General’s office, that the Senate version of the “Section 112” exclusion is in fact a clerical error that carries no legal weight. Even were the Senate version deemed to be viable, there is another persuasive argument asserting that both the House and Senate versions may be read harmoniously so as to give them both meaning, in which case EPA would not have the authority to issue the Clean Power Plan (id.))

Professor Revesz’s Claim: In written testimony, Professor Revesz states that “EPA has consistently construed this Section 112 exclusion in Section 111(d) to pertain to air pollutants, not entire source categories.” That is, he claims that EPA for more than two decades has consistently interpreted the Clean Air Act in order to give effect to the Senate version of the “Section 112 exclusion” (i.e., the version that would allow EPA to issue the Clean Power Plan). If true, this would be a powerful argument in support of the Clean Power Plan.

Respectfully, I maintain that Professor Revesz’s claim in unfounded and indeed contrary to the historical record. To support his claim, Professor Revesz provides a host of examples (see footnote 12), which are rebutted in turn below.

CEI Rebuttal #1: Here, Professor Revesz cites EPA’s 1991 Proposed Standards of Performance for New Stationary Sources and Guidelines for Control of Existing Sources: Municipal Solid Waste Landfill (56 FR 24468). However, the page cited by the Professor fails to mention in any fashion the “Section 112 Exclusion,” much less does it render a statutory interpretation of Section 111(d). Here’s what the citation actually says:

The EPA develops emission guidelines under section 111(d) of the CAA for certain sources covered by NSPS. When an NSPS has been promulgated under section 111(b) for a category of sources, section 111(d) of the CAA requires that States submit plans which establish emission standards for existing sources and provide for implementation and enforcement of emission standards for the designated pollutant. In general, a designated pollutant is one that may cause or contribute to endangerment of public health or welfare but is not “hazardous” within the meaning of section 112 of the CAA and is not controlled under sections 108 through 110 of the CAA. For ease of discussion, existing facilities which emit designated pollutants are considered to be “designated facilities.”

Contrary to what Professor Revesz suggests, there is nolanguage that explicitly backs his claim in the “1991 Proposed Standards of Performance for New Stationary Sources and Guidelines for Control of Existing Sources: Municipal Solid Waste Landfill.” Nonetheless, EPA did directly address the “Section 112 Exclusion” later in the same rulemaking. In a 1995 technical support document attendant to the final rule, EPA gave an interpretation to 111(d) in light of the conflicting House and Senate versions of the provision. And, in this technical support document, EPA arrived at the opposite interpretation as is now maintained by Professor Revesz! Here’s what agency stated:

Section 111(d)(1)(A) was twice amended by the 1990 Clean Air Act Amendments. Pub. L. 101-549, section 302(a), directed the substitution of “7412(b)” for “7412(b)(1)(A),” and Pub. L. 101-549, section 108(g), substituted “or emitted from a source category which is regulated under section 7412 of this title” for “or 7412(b)(1)(A).” Title 42 of the U.S. Code adopts the amendment of section 108(g) with the explanation that section 302(a) could not be executed because of the prior amendment by section 108(g). 42 U.S.C. section 7411 (Supp.IV 1993). The EPA also believes that section 108(g) is the correct amendment because the Clean Air Act Amendments revised section 112 to include regulation of source categories in addition to regulation of listed hazardous air pollutants, and section 108(g) thus conforms to other amendments of section 112. The section not adopted by title 42, 302(a), on the other hand, is a simple substitution of one subsection citation for another, without consideration of other amendments of the section in which it resides, section 112. Thus EPA agrees that CAA section 111(d)(1)(A) should read “[t]he Administrator shall prescribe regulations which . . . establish[] standards of performance for any existing source for any air pollutant . . . which is not . . . emitted from a source category which is regulated under section 112. (EPA, Air Emissions from Municipal Solid Waste Landfills – Background Information for Final Standards and Guidelines, Pub. No. EPA-453/R-94-021, at 1-5 (1995))

Therefore, Professor Revesz’s first example actually works against him. Within the very rulemaking he cited, EPA construed the “Section 112 exclusion” to pertain to entire source categories. As such, it is demonstrably untrue that “EPA has consistently construed this Section 112 exclusion in Section 111(d) to pertain to air pollutants, not source categories,” as is maintained by Professor Revesz.

CEI Rebuttal #2: With this example, Professor Revesz highlights EPA’s promulgation of Section 112 standards for pulp and paper producers (63 FR 18504), even though this source category is already subject to Section 111 standards. Seemingly, the Professor is suggesting that the coexistence of section 112 and section 111(d) standards for the same category disproves the argument that the Section 112 exclusion in Section 111(d) pertains to source categories.

However, Professor Revesz ignores the temporal sequence contemplated by the 112 exclusion. In short, order matters: There’s no prohibition on having a Section 112 regime for a category that is already subject to Section 111(d). Rather, the opposite is true: EPA is prohibited from promulgating a Section 111(d) regime for a category subject to 112.

Indeed, the context of the 1990 Clean Air Act Amendments lends logic to the fact that sequence matters. The 1990 Amendments grossly expanded Section 112, which applies ultra-stringent controls to existing sources. Being wary of duplicative regulation, Members of Congress softened the Clean Air Act pre-existing regulatory program for existing sources—i.e., 111(d)—such that it no longer authorized new regulations for categories subject to Section 112.

So, the Professor Revesz’s third example contains no language that supports his contention that “EPA has repeatedly interpreted Section 111(d) in ways that are consistent with its authority to promulgate the Clean Power Plan” (Revesz testimony, p 8).” Instead, Professor Revesz’s third example seems to suggest (again) thatthe simultaneous coexistence of section 112 and section 111(d) standards for the same category precludes the possibility that the 112 exclusion in Section 111(d) pertains to entire source categories, and not individual pollutants.

However, Professor Revesz’s reasoning falters for the same reasons we discussed above in “CEI Rebuttal 2.” EPA promulgated 111(d) Guidelines for total reduced sulfur emissions from existing Kraft pulp mills in March 1979. Maryland submitted its compliance plan in March, 1984 (47 FR 8612). And EPA promulgated Section 112 standards for Kraft pulp mills in April 1998 (63 FR 18504). As this timeline makes clear, the 111(d) standards for Kraft pulp mills came almost two decades before the Section 112 standards. Because the Section 112 standards did not precede the Section 111 standards, EPA’s actions are not prohibited by the plain terms of the Clean Air Act.

CEI Rebuttal #5: Professor Revesz here again is citing a revision to Maine’s existing 111(d) state air quality plan for total reduced sulfur emissions from existing Kraft pulp mills (68 FR 23209). Maine’s original plan was approved by EPA in September 1990 (55 FR 38545).

More to the point, Professor Revesz’s reasoning falters for the same reasons we’ve previously discussed—i.e., order matters. EPA promulgated 111(d) Guidelines for total reduced sulfur emissions from existing Kraft pulp mills in March 1979. Maine submitted its compliance plan in February, 1990 (see 55 FR 38545 at 38546); it was approved by EPA on September 19, 1990 (id.). EPA then promulgated Section 112 standards for Kraft pulp mills on April 15, 1998 (63 FR 18504). Because the Section 112 standards did not precede the Section 111 standards, EPA’s actions are not prohibited by the plain terms of the Clean Air Act.

EPA promulgated Section 111(d) standards for existing landfills in March, 1996; the agency ultimately promulgated Section 112 standards for existing landfills in January, 2003. Because the Section 112 standards did not precede the Section 111 standards, EPA’s actions are not prohibited by the plain terms of the Clean Air Act.

Professor Revesz’s Example #8: “77 Fed. Reg. 9304, 9447 (Feb. 16, 2012) (“Designated pollutant means any air pollutant, the emissions of which are subject to a standard of performance for new stationary sources, but for which air quality criteria have not been issued and that is not included on a list” published under Section 108 or Section 112.)”

CEI Rebuttal #8: Of all 8 examples cited by professor Revesz to support his thesis that, “EPA has consistently construed this Section 112 exclusion in Section 111(d) to pertain to air pollutants, not entire source categories,” this is the only one that actually works. However, it is an interpretation rendered by the very administration that proposed the Clean Power Plan!

In a nutshell, Whitman accuses McConnell of urging States to break the law. Nonsense. Declining to submit a plan to implement EPA’s regulation is a lawful option under the Clean Air Act. Indeed, the right of States to keep their fingerprints off regulations they regard as unlawful or simply as misguided is basic to the “cooperative federalism” concept on which the Clean Air Act is based. Whether or not states should be complicit in the Clean Power Plan is a prudential question. McConnell argues (correctly, IMO) that the most prudent course for States is to let EPA bear sole responsibility for implementing an unlawful rule.

Although Whitman quotes two sentences from McConnell’s essay, she never engages any of his arguments. Instead, she tut-tuts about the rule of law without apparently understanding what it means.

I reproduce Whitman’s column below and offer commentary on each part. Her text is indented in blue, my comments are standard width in black.

Whitman: Sen. Mitch McConnell earlier this month encouraged states to defy federal environmental regulations by simply ignoring them. This was not some quote taken out of context by a pesky reporter; it was an op-ed he wrote in the Lexington Herald-Leader. The Republican Senate majority leader is protesting the Environmental Protection Agency’s proposal to cut greenhouse gas emissions from coal plants. The agency plans to finalize the rule this summer, after which states will have a chance to submit their own plans to meet the EPA’s specific goal for the state. He writes:

“Think twice before submitting a state plan — which could lock you in to federal enforcement and expose you to lawsuits — when the administration is standing on shaky legal ground and when, without your support, it won’t be able to demonstrate the capacity to carry out such political extremism. Refusing to go along at this time with such an extreme proposed regulation would give the courts time to figure out if it is even legal, and it would give Congress more time to fight back.”

None of this is surprising from the senator who said shortly after his reelection that his top priority was “to try to do whatever I can to get the EPA reined in,” but it is extremely disappointing and has the possibility to undermine our nation’s entire rule of law.

ML Comment: It’s also not surprising that a prominent EPA alumna sides with her alma mater. Just as the value of your diploma is affected by your school’s subsequent academic standing, so the prestige of a former Administrator is affected by the public perception, regulatory reach, and economic importance of the agency she once ran.

Whitman: I was brought up to believe that following the law isn’t optional. If you do not like one of those laws, you work to change it. This is why public service is so important — we have to trust our leaders to make the right laws, and if we feel they are not meeting that goal, we have to be willing to engage in the civic process. To have one of our country’s leaders call on states to flout EPA’s appropriate regulation is in direct contradiction to the oath of office that he took.

ML Comment: One would hope Whitman was also brought up to believe that an unconstitutional, unlawful, or unjust policy is not valid law, and that refusing to heed unlawful policies is an honorable way to bring controversies before courts and shape the opinion climate in which cases are decided. The civil rights struggle springs to mind.

Note: McConnell is not urging states to ‘nullify’ the Clean Air Act, the supposed authority for the CPP. Rather, he asks only that States not take ownership of EPA’s unlawful scheme. EPA would still have the power under the Act to adopt a federal implementation plan if states refuse to play ball. Of course, courts and Congress could still overturn or repeal the CPP at a later date. McConnell is betting, quite sensibly, that widespread rejection of the CPP by a multitude of States will boost the chances for successful legal and legislative challenges.

Whitman says: “We have to trust our leaders to make the right laws.” Nope. Skepticism about the self-advertised wisdom, benevolence, and authority of “our leaders” is a prerequisite for maintaining liberty and a republican form of government.

Whitman’s claim that McConnell’s advice to the states directly contradicts his oath of office is silly. Here’s the text of the oath:

I do solemnly swear (or affirm) that I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; that I take this obligation freely, without any mental reservation or purpose of evasion; and that I will well and faithfully discharge the duties of the office on which I am about to enter: So help me God.

The oath obliges McConnell to support and defend the U.S. Constitution — not EPA or its self-serving interpretation about the scope of its own powers.

Whitman: Far more significant than the senator’s ongoing battle with the EPA, this has the potential to open Pandora’s box when it comes to legislation and our rule of law. This recommendation on behalf of a sitting senator and Senate leader crosses a line that could easily lead to people or states simply choosing which laws they follow. In such a culture, how do you teach children right from wrong, ensuring the next generation doesn’t view all laws as discretionary? This behavior undermines our government as a whole, as well as our deeply held conviction that the rule of law is the foundation of any stable society. After all, the rule of law is the standard we use when determining foreign aid, among other things; it cannot and should not be taken lightly.

ML Comment: This homily fails on three counts. First, Whitman glosses over the fundamental distinction between “rule of law” and bureaucratic fiat. As discussed in previous posts, the CPP is unlawful on at least 10 separate counts, even flouting the very provision of the Clean Air Act that allegedly authorizes it. The issue is not whether people or states may choose which laws to follow. Rather, it is whether agencies may demand fealty to novel statutory interpretations that “would bring about an enormous and transformative expansion” of their “regulatory authority without clear congressional authorization” (UARG v. EPA, 2014, slip op. p. 19).

Second, as my colleague William Yeatman points out, the CPP is an illegitimate bait-and-switch. In a constitutional republic, policies derive from statutes, which in turn derive from elections. When Obama sought re-election in 2012, he did not run on the CPP or any program of CO2 regulation, for that matter. Rather, on energy, candidate Obama ran to the right of Mitt Romney, accusing his opponent of being anti-coal.

Third, “rule of law” is an empty phrase masking bureaucratic usurpation absent a constitutional structure under which agencies wield only those powers delegated to them by politically-accountable elected officials. Congress never authorized EPA to implement anything remotely like the CPP. Even during 2009-2010, when Democrats controlled both chambers of Congress, legislation authorizing EPA to do exactly what it is doing now – impose CO2 caps on state electric power sectors — would have been dead on arrival.

Through the CPP, EPA seeks to empower itself to control electricity production, consumption, and distribution within each State. Those are “matters that have always been deemed to be wholly within a State’s powers,” Harvard Law Professor Lawrence Tribe stated in testimony last week.

There is no title, section, or subsection of the Clean Air Act authorizing EPA to control State renewable energy quota, electricity dispatch rules, or electricity conservation incentives — yet the CPP chiefly relies on such measures to achieve States’ EPA-determined CO2 caps. The Federal Power Act (FPA) does authorize another agency – the Federal Energy Regulatory Commission (FERC) — to regulate inter-state electricity sales in wholesale power markets. But, as Tribe’s testimony notes, the FPA gives States “exclusive jurisdiction over intrastate electricity matters.”

Whitman: As a prominent elected official representing the Republican Party to the country, Sen. McConnell has an obligation to hold himself to the highest standards. He can rail against EPA, cut its budget, do all that he has the power to do within the law if he must, but he cannot and should not call on others to ignore a law. He may regret the consequences, as will we all.

ML Comment: Again, McConnell is not calling on anyone to “ignore a law.” The Clean Air Act authorizes EPA to implement its regulations through a federal plan if states decline to submit their own implementation plans. In other words, States have the option under the law to force the Obama administration to take sole proprietorship of the regulation. That should help build political resistance to the CPP at the same time States and industry challenge the regulation in court. Following McConnell’s advice should increase the odds courts or Congress will overturn the rule and rein in EPA.

That’s the real reason Whitman is upset. She does not want EPA reined in. She does not want her alma mater constrained by the rule of law. Her critique of McConnell is Orwellian.

You know or suspect that the administration’s war on carbon energy is either a costly exercise in futility or a humanitarian disaster, depending on how aggressively they pursue it. You may also know or suspect that “all of the above” is Washington-speak for dispensing more corporate welfare to under-performing energy companies.

So what would a genuine pro-market energy agenda look like? Sen. Ted Cruz (R-Texas) and Rep. John Bridenstine (R-Okla.) put it all together in a bill titled the American Energy Renaissance Act. The bill would “remove federal impediments to energy exploration, development, and trade.” It would increase U.S. GDP, economic opportunity, and geopolitical influence by reducing federal interference with market-driven energy investment.

Leave regulation of hydraulic fracturing in state hands. Hydraulic fracturing is driving the American Energy Renaissance. States have proven they can oversee hydraulic fracturing in a responsible, safe manner, and they should be allowed to continue. The American Energy Renaissance cannot thrive if the federal government disrupts this effective framework and impedes the jobs and economic growth hydraulic fracturing is already providing.

Streamline the permitting process for upgrading existing and building new refineries. The operating capacity of U.S. refineries has remained essentially stagnant for three decades. In order for the American Energy Renaissance to reach its full potential, barriers must be removed from expanding or constructing new refineries in the United States and the private sector jobs they will create.

Phase out and repeal the Renewable Fuel Standard (RFS) over five years. The RFS has proven unworkable and costly. Its mandate that an increasing percentage of renewable biofuels be blended into gasoline and diesel each year ignores the reality there are insufficient amounts of some biofuels to meet the standard. It imposes significant costs, and offers few, if any, benefits. The RFS should be phased out so producers and refiners can focus on maximizing domestic resource potential.

Immediately approve and allow the private sector to build the Keystone pipeline. According to the U.S. State Department, constructing the Keystone XL pipeline could result in 42,000 jobs. Keystone has undergone five environmental reviews since its initial application in 2008, and none has found a significant negative impact on the environment. President Obama’s former Energy Secretary admitted that the decision as whether to approve the Keystone XL oil pipeline is a political one, and not a decision founded in science.

Remove barriers to developing and approving additional national pipelines and cross-border energy infrastructure. The Keystone saga imposed by the federal government demonstrates the need to reform the process of approving oil and natural gas pipelines, as well as electric transmission lines, between the United States, Canada, and Mexico.

Exclude greenhouse gases from regulation by the EPA and other federal agencies. Proposals to regulate greenhouse gases are very expensive and threaten hundreds of thousands of jobs. The authority to regulate such gases should only occur with explicit authority from Congress.

Stop certain EPA regulations that will adversely impact coal and electric power plants. In 2008, President Obama promised to bankrupt coal. As of October 2014, there were already 381 coal units closed or closing in 36 states because of EPA policies. These 381 closures amount to a total of more than 60,100 megawatts of electricity generation no longer being available. Job losses as a result of coal units being affected by EPA regulations could amount to more than 50,000 direct jobs in the coal, utility, and rail industries, and an indirect job loss figure exceeding 250,000.

Require Congress to approve and the President to sign EPA regulations that will have a negative job impact, rather than allowing them to hide behind bureaucrats who are assumed to be responsible for them now. Certain planned and proposed EPA regulations could cost more than 2 million jobs. Increasing regulatory restrictions more broadly could cost nearly 2.8 million jobs over the next decade.

Expand energy development on federal lands by providing states the option of leasing, permitting and regulating energy resources (oil and gas, wind and solar) on federal lands within their borders. Onshore and offshore federal land lands have about 43 percent of America’s proven oil reserves and 25 percent of natural gas reserves, but not all of the land is available for energy development. Leasing and producing oil and natural gas on federal land could create more than 1 million jobs.

For those states opting not to self-regulate, federal leasing, permitting, and regulating must be reformed by:

Streamlining permitting and expanding development on federal lands by requiring decisions regarding drilling permit applications to be made within 30 days (which can be extended), requiring an explanation for any denial, and deeming applications to be approved if no decision has been made within 60 days, unless there are existing incomplete environmental reviews.

Improving certainty in the leasing and development process by instituting a presumption that certain land will be leased and by prohibiting the government from withdrawing a lease for any energy project, unless there is a violation of terms of the lease.

Expand energy development in the National Petroleum Reserve in Alaska and on Indian Lands. The mean estimate for conventional oil in the National Petroleum Reserve in Alaska is 895 million barrels of oil and 52.8 trillion cubic feet of gas. West of the Mississippi River, Indian reservations contain almost 30 percent of the nation’s coal reserves, 50 percent of potential uranium reserves, and 20 percent of known oil and gas reserves.

Open up the Coastal Plain of Alaska (ANWR) for development. ANWR consists of 19 million acres in northeast Alaska. Its 1.5-million-acre Coastal Plain is viewed as a promising onshore oil prospect with potentially 7 billion barrels of technically recoverable oil.

Expand the offshore areas of the Outer Continental Shelf (OSC) available for development. Despite the potential for significant oil and gas development off the coasts of the United States, the Obama Administration has severely limited access to such resources by essentially prohibiting energy exploration and development off the Atlantic and Pacific coasts.

Streamline the permitting process for additional offshore exploration. Regulatory barriers to obtain leases and permits to explore and develop offshore areas of the Outer Continental Shelf should be removed by requiring lease sales within 180 days of enactment of the legislation and every 270 days thereafter, and requiring approval or disapproval of drilling permits no later than 20 days after an application is submitted.

Expand LNG exports by facilitating permits. As of March 3, 2015, the Dept. of Energy had approved only nine export permits to non-Free Trade Agreement countries. More than twenty applications are currently pending.

End the crude oil export ban. Last year, U.S. crude oil production increased 27 percent but many American refineries cannot handle the additional crude for technical and capacity reasons. The United States is missing out on export opportunities that could produce good paying private sector jobs in the United States.

Prevent excessively broad environmental review of coal export terminals. As the EPA makes it harder to use coal as a source of energy for electricity in the United States, there are opportunities to export coal to other nations. Removing excessive environmental reviews can help promote coal exports that will help keep coal jobs in the United States.

Direct all additional revenues generated by exploration and drilling on federal lands (excluding the share allocated to the states) exclusively to national debt reduction. The U.S. national debt was approximately $18.2 trillion in December 2014. As we free the development of U.S. natural resources to spur economic and job growth, we should prevent revenues from being used to further expand government programs and instead use it to free taxpayers from the debt burden that hampers the nation’s incredible potential.

My only quibble — and it’s with the talking points, not the bill – is the lawmakers’ contention that current policies significantly constrain U.S. petroleum refining capacity. A recent report by the American Fuel and Petrochemical Manufacturers Association suggests that lack of delivery infrastructure, not refining capacity, which continues to expand, is the major bottleneck to increased production of petroleum products today.

Although President Obama describes his administration as “the most transparent in history,” a new analysis by the Associated Press (AP) finds that, “The Obama administration set a record again for censoring government files or outright denying access to them last year under the U.S. Freedom of Information Act.”

FOIA failings identified by AP include:

The government took longer to turn over files when it provided any, said more regularly that it couldn’t find documents and refused a record number of times to turn over files quickly that might be especially newsworthy.

It also acknowledged in nearly 1 in 3 cases that its initial decisions to withhold or censor records were improper under the law – but only when it was challenged.

Its backlog of unanswered requests at year’s end grew remarkably by 55 percent to more than 200,000. It also cut by 375, or about 9 percent, the number of full-time employees across government paid to look for records. That was the fewest number of employees working on the issue in five years.

It more than ever censored materials it turned over or fully denied access to them, in 250,581 cases or 39 percent of all requests.

On 215,584 other occasions, the government said it couldn’t find records, a person refused to pay for copies or the government determined the request to be unreasonable or improper.

Under the president’s instructions, the U.S. should not withhold or censor government files merely because they might be embarrassing, but federal employees last year regularly misapplied the law.

The government’s responsiveness under the open records law is an important measure of its transparency. . . .Anyone who seeks information through the law is generally supposed to get it unless disclosure would hurt national security, violate personal privacy or expose business secrets or confidential decision-making in certain areas. It cited such exceptions a record 554,969 times last year.

“What we discovered reaffirmed what we have seen all too frequently in recent years,” [AP chief executive Gary] Pruitt wrote in a column published this week. “The systems created to give citizens information about their government are badly broken and getting worse all the time.”

]]>http://www.globalwarming.org/2015/03/18/ap-analysis-obama-administration-sets-record-for-flouting-freedom-of-information-act/feed/0Introducing VICE News to 2012 Debate Obama (the one who ran to the right of Romney on AGW/energy)http://www.globalwarming.org/2015/03/17/introducing-vice-news-to-2012-debate-obama-the-one-who-ran-to-the-right-of-romney-on-agwenergy/
http://www.globalwarming.org/2015/03/17/introducing-vice-news-to-2012-debate-obama-the-one-who-ran-to-the-right-of-romney-on-agwenergy/#commentsTue, 17 Mar 2015 13:04:26 +0000http://www.globalwarming.org/?p=23391

Debate Obama didn’t care about AGW and loved coal

VICE News, which is somehow valued at $2.5 billion (10 times the 2013 price of the Washington Post), recently conducted a sycophantic interview with President Obama. As I understand it, VICE News reporters are supposed to be too-cool-for-school iconoclasts. However, instead of suspicion of “the man,” VICE News founder Shane Smith performed the interview with an evident thrill up his leg.

The first segment addressed environmental policy. Smith started by asking the president, “How do you deal with the negativity? Are you a masochist?” Then he complemented President Obama for having a “rational, sane” plan for dealing with climate change. Finally, after referencing Senate Republicans, he asked why “we’re not acting in a sane and rational way” on global warming (presumably like the President is). Hard hitting stuff.

Today, my purpose is to shatter VICE’s naivety by introducing them to 2012 debate Obama. Debate Obama—the guy trying to get elected by the American people—staked out a position to the right of Republican Mitt Romney on environmental and energy policy. This guy didn’t say a word about climate change. Rather, Debate Obama was all about oil, gas, and even (gasp!) *dirty* coal. Indeed, Obama never once mentioned AGW in any of the 2012 debates. During the VICE interview, by contrast, the President claimed that global warming was among his top priorities.

I humbly submit that Debate Obama demonstrates that the President doesn’t give a hoot about AGW, aside from its legacy-building potential or value in terms of partisan positioning. In short: He’s pulling the wool over your eyes, Mr. Smith.

EPA is more than 15-months behind its statutory deadline (Nov. 30, 2013) for establishing Renewable Fuel Standard (RFS) blending targets for last year.

To recap, in Nov. 2013, EPA for the first time proposed to scale back the government’s overall biofuel blending target for the following year. EPA determined that the statutory target for 2014 would exceed the “blend wall” — the maximum quantity of ethanol that can be sold each year given legal or practical constraints on how much can be blended into each gallon of motor fuel.

The most common blend today is E10 — motor fuel with up to 10% ethanol. Although EPA approved the sale of E15 in October 2010, potentially increasing by 50% the total amount of ethanol sold annually, lack of compatible fueling infrastructure, warranty and liability concerns, and, most importantly, consumers’ natural aversion to paying more for a lower-value product effectively limit the standard blend to E10.

So in Nov. 2013, EPA proposed to trim the statutory target for 2014 from 18.15 billion gallons to 15.21 billion gallons — a 16% cutback. That ignited a firestorm of protest from biofuel interests, and EPA has been dithering ever since.

Biofuel lobbyists such as Renewable Fuels Association CEO Bob Dinneen claim the blend wall exists only because the oil industry has “steadfastly refused” to invest in blender pumps, storage tanks, and other infrastructure compatible with E15-and-higher ethanol blends. Weirdly unexplained is why it’s not up to the biofuel industry to pay for the infrastructure on which its success supposedly depends. The RFS forces the oil industry to buy biofuel, process and add value to it, and create a guaranteed retail market for it. Isn’t that enough?

Not for Dinneen and company. If they had their druthers, Congress would compel oil companies to build biofuel-compatible infrastructure and (as President Obama proposed during his first presidential campaign) mandate that all new cars be flex-fuel vehicles capable of running on blends up to E85 (motor fuel made with 85% ethanol).

But would even that policy wish-list eliminate the growing mismatch between market realities and the RFS production quota schedule, which requires 36 billion gallons of biofuel to be blended and sold by 2022? No.

Although ethanol is cheaper by the gallon than regular gasoline, ethanol has about one-third less energy than an equal volume of gasoline. On an energy-adjusted (bang-for-buck) basis, regular gasoline is almost always the better buy than ethanol. Consequently, the higher the ethanol blend, the worse mileage your car gets, and the more money you spend to drive a given distance.

FuelEconomy.Gov, a Web site jointly administered by EPA and the Department of Energy (DOE), calculates how much a typical motorist spends in a year to fill up a flex-fuel vehicle with either E85 or regular gasoline. The exact bottom line changes as gasoline and ethanol prices change. The big picture, though, is always the same: Ethanol is a net money loser for the consumer.

At today’s prices, depending on make and model, it costs an extra $900, $1,200, $1,600, or even $2,400 annually to run a flex-fuel vehicle on E85 rather than regular gasoline. Those hefty price differences — not oil company machinations or EPA indecision — are the principal barrier to market penetration of E85 and other high-ethanol blends.

Even if everybody owned a flex-fuel vehicle, and every service station installed E85 blender pumps, few willing customers would buy the fuel. Lower energy content, inferior fuel economy, and higher consumer cost are the root cause of the blend wall. The same factors also explain why the ”choice” to buy ethanol must be mandated. After all, if ethanol were a great deal for consumers, why would we need a law to make us buy it?

EPA and DOE estimate the annual gas and E85 expenditures for 238 flex-fuel vehicle models. Here are the agencies’ estimates for eight of those models.

The tortuous Richard Windsor saga took yet another twist yesterday, when we filed suit to compel EPA to stop flouting the Freedom of Information Act (FOIA).

To recap: In 2012, I discovered that ex-EPA administrator Lisa Jackson used an alias email persona, known as “Richard Windsor,” in an obvious attempt to evade scrutiny under transparency laws. After a more limited request for certain “war on coal” emails, CEI then submitted a FOIA request for all emails to and from Mr. Windsor/Administrator Jackson. However, EPA has gone to extraordinary lengths to dodge its responsibilities to fulfill the request–despite the Obama administration’s promise to be “the most transparent ever.”​

Indeed, CEI has endured multiple rounds of EPA obfuscation. After reversing two absurd delaying maneuvers on administrative appeal, EPA agreed to process an unprecedentedly low 100 records a month—over the course of the next 100 years!

The agency denied our appeal of that insanity, and then, when we appealed heavy-handed redactions, informed us it would no longer consider appeals (that it expressly invited) until wrapping up production around the year 2114.

Of course, this is ridiculous at face value. Agencies cannot impose undue delay in producing records; yet we will all be long dead before EPA finishes. Without a doubt, EPA is being unreasonable. Such a schedule makes a mockery of transparency laws, not to mention empty political promises re: same.

Compounding matters immensely, EPA claims it is holding several other CEI FOIA requests hostage until it completes processing this century-long production. And it’s not just CEI—EPA is refusing to process a request from another group that’s not even from me! Rather, it’s simply another group on behalf of which I have made requests. Thus, the agency is using its blatant, beyond flippant disregard of its transparency responsibilities as a justification for further skirting of its FOIA duties.

Enough is enough is enough. Yesterday, CEI sued in the federal district court of the District of Columbia, in order to compel the agency to comply with FOIA on a reasonable basis.

Given the strenuous efforts EPA has taken to hide these emails, and what we have learned to date, it is more than fair to assume this is more than petulant retaliation, but hiding something awfully damning.

…EPA’s use of a Clean Air Act provision regarding the ozone layer in an effort to advance the President’s international climate goals.

This ongoing regulatory regime is known as the Significant New Alternatives Policy program, and it represents the worst of all worlds: it’s a naked power grab; it’s bolstered by rent-seeking; and it actually endangers public health. On account of all of these factors, it’s the pound-for-pound worst regulation promulgated yet by Obama’s EPA.

Bullet-point background:

In the 1970s and 1980s, people became increasingly concerned with the possibility that common household and commercial chemicals (primarily aerosols and refrigerants) were depleting the ozone layer. In the face of this public concern, countries were reluctant to act, because (at the time) there were no readily available alternatives to ozone-depleting chemicals. As a result, the costs were deemed prohibitive.

Industry stridently opposed regulation. However, by the mid-1980s, certain influential chemical companies (Du Pont being foremost among them) had developed alternatives to ozone depleting substances. Sensing a business opportunity, in 1986 the chemical industry suddenly threw its support behind regulation. Having pioneered ozone-safe products, major chemical corporations stood to reap windfall profits if governments forced consumers to use their *new and improved*chemicals for aerosols and refrigeration.

Of course, once the largest corporations supported a global regulatory regime for protecting the ozone layer, governments were soon to follow. In September of 1987, 46 countries agreed to the Montreal Protocol on Substances that Deplete the Ozone Layer, a treaty to phase out the use of chemicals that threatened the ozone layer. Thus, the Montreal Protocol was born of rent-seeking.

The U.S. Senate ratified the Montreal Protocol in March 1988, and the treaty went into effect in January 1989.

A year later, in 1990, Congress amended the Clean Air Act to create a regulatory regime for implementing the Montreal Protocol. Accordingly, Clean Air Act §612 establishes the Significant New Alternatives Policy (SNAP) program, which is the primary mechanism for achieving the ozone treaty’s goals. Under SNAP, EPA is empowered to ban chemicals that deplete the ozone layer, if the agency concludes that there are alternatives that would do less environmental harm. [Editor’s note: By authorizing EPA to literally pick winners and losers in the chemical industry, the SNAP program is a rent seekers dream. More on this below]

For the first 25 years of the SNAP program, EPA effectively mandated the use of a class of chemicals known as “HFCs.” These HFCs made ideal substitutes: They didn’t pose a threat to the ozone layer, they were non-toxic, and they were non-flammable.

Notwithstanding these beneficial attributes, HFCs are potent greenhouse gases. On a per-molecule basis, they have a much higher “global warming potential” than carbon dioxide, the benchmark GHG. For example, the most commonly used HFC, HFC-134a, has 1,430 times more heat-trapping potential than CO2.

Due to the aforementioned high “global warming potential” of HFCs, the Obama administration in each of the last four years has proposed an amendment to the Montreal Protocol that would phase out their use. The amendment has not been adopted. Therefore, the Montreal Protocol is not in any way a climate change mitigation treaty.

Having failed to achieve an international treaty to reduce HFCs as a climate mitigation strategy, President Obama decided to do so unilaterally, without any input from Congress. In September 2013, the Obama administration released his “Climate Action Plan,” which included a provision ordering EPA to use the SNAP program to phase out HFCs.

EPA abided the President’s command. On August 6, 2014, the agency proposed a rule that would prohibit the most commonly used HFCs (79 FR 46126). And on February 27, 2015, the agency finalized a rule that approved certain substitutes for the banned HFCs (pre-publication version)

Without further ado, I list the reasons why this obscure regulatory regime, as it is currently being implemented, is the worst of the Obama-bunch.

EPA’s SNAP Program Is Another Executive Power Grab by the Obama Administration

There is neither a legal nor electoral basis for EPA’s basing climate change mitigation strategies on ozone layer protections added to the Clean Air Act pursuant to the Montreal Protocol. As such, this is a power grab on multiple fronts.

For starters, no one in the Senate thought that the Montreal Protocol had anything to do with global warming when the upper chamber ratified the treaty in 1988. And while the Obama administration repeatedly has tried to amend the treaty to incorporate climate policy, these efforts thus far have been unsuccessful. Now, the administration is unilaterally imposing its proposed treaty commitments, via the EPA.

EPA’s climate policy to phase out HFCs also makes a mockery of the agency’s statutory bounds. When Congress amended the Clean Air Act in 1990 to implement the Montreal Protocol, lawmakers thought they were addressing a hole in the ozone layer. Now, EPA is interpreting a Clean Air Act chapter titled “stratospheric ozone protection” such that its purpose has become climate change mitigation.

So… the Obama administration has unilaterally implemented a proposed amendment to the Montreal Protocol—without the Senate’s consent. And with the same stroke, EPA has taken a Clean Air Act program that addresses harm to the ozone layer, and—without any congressional input— leveraged it into a regulatory regime for fighting global warming. It would seem that limits imposed by laws and treaties always yield to this administration’s policy desires (which themselves are functions of the special interests responsible for electing the president).

EPA’s SNAP Program Is the Archetype of Rent-Seeking

Indeed, rent-seeking was crucial to providing cover for the above-described power grab. The Obama administration would not have unilaterally changed the terms of the Montreal Protocol and Title VI of the Clean Air Act, unless the agency had the full backing of the biggest businesses in the industry.

In this case, the rent-seeking parties are Du Pont and Honeywell. They’re lending full-throated support for the Obama administration’s SNAP program, for the simple reason that they stand to benefit handsomely. The two business giants aren’t content winning in the marketplace; instead, they’re intent on winning over administration officials at the EPA, who have the power to force consumers to use Honeywell/Du Pont products.

Five years ago, the two companies entered into a partnership to produce an alternative to HFCs in motor vehicle air conditioning systems. The new chemical is known as “R-1234yf.” In a summer 2014 announcement, EPA proposed banning the primary HFC used as a refrigerant in cars and trucks, known as HFC-134a, based on the existence of an adequate supply of R-1234yf, due to the latter’s lower global warming potential. As a result, Honeywell and Du Pont stand to make a fortune. Notably, the EU Commission has launched a formal antitrust investigation into the two companies’ cooperation in the manufacture of R-1234yf.

That the rule is welcomed by rent seekers is no secret inside the beltway. In late 2014, InsideEPA’s Dawn Reeves reported,

Another industry source says the stepped-up administration effort likely won broad industry support and commitments for voluntary action because it will guarantee some of the larger chemical manufacturers a market for safer alternatives. “To get the [companies] to the table on voluntary commitments, the White House promised that EPA would move faster to accept the alternative technology that those guys are in a position to produce. So they are getting something out of it,” the source says.

EPA’s SNAP Program Endangers Human Health

For manufacturers of retail and residential food refrigerating units, EPA is phasing out HFCs because they are allegedly riskier than certain alternatives, including ethane, propane, isobutene, and R-441A.

Here’s the problem. Whereas the soon-to-be-banned HFCs are nonflammable and can be operated under low pressures, the alternatives that are closest to market availability for commercial refrigeration are either highly flammable or must be used with very high pressure. In fact, EPA concluded that the non-flammable HFCs posed a greater risk to human health than the flammable/high pressure alternatives, due to the former’s larger carbon footprint.

This is patently absurd. EPA administrator Gina McCarthy has conceded that her agency’s regulations won’t actually impact the climate, so it’s impossible for EPA’s SNAP program to actually mitigate any risk. By contrast, EPA’s SNAP program, by mandating the use of flammable chemicals, threatens to blow someone up. The threat of being blown up is a clear and present danger; the threat of AGW is an abstract. EPA’s reasoning is plainly ridiculous.

For a couple months now, there’s been a battle brewing among critics of EPA’s Clean Power Plan. While we all agree the rule is illegal and illegitimate, there’s much disagreement on strategy.

On the one side are arrayed various politicians and non-profits, who argue that the rule is such an unacceptable affront to cooperative federalism, that States should simply refuse to play ball. That is, they recommend that States should refuse to submit compliance plans, and instead place the onus on EPA to impose a federal plan. This side’s take is purely principle.

On the other side are arrayed state regulators and the business community, and their concerns are more practical. By and large, they agree that the Clean Power Plan is an unacceptable affront to cooperative federalism. However, they also believe that a “just say no” strategy is too risky to pursue, albeit for different reasons:

For industry, it’s essentially a fiduciary responsibility to oppose the do-nothing camp. That’s for two reasons: First, businesses generally hold more sway with local officials, so they’d have less input under a federal plan. Second, and more importantly, utilities are ultimately on the hook for compliance. They’re the ones who would face daily fines that can measure well into the scores of thousands of dollars. So they’re not as keen on the whole non-compliance idea.

For state regulators, it’s somewhat similar. Ultimately, they’re on the hook for implementing the regulation. If a State refuses to comply altogether, then it arguably makes the regulators’ job more difficult.

The “just say no” camp won a major victory this week when Senate Majority Leader Mitch McConnell endorsed their position in an oped. Subsequently, it was reported that McConnell’s oped was seconded by several influential Members of Congress, including Senate EPW chairman James Inhofe and Energy & Power subcommittee chairman Ed Whitfield. This set off a flurry of mediareports, about how congressional republicans were urging States to defy EPA’s climate regulations.

All of this brings me to the point of this post–the distinct possibility that none of this matters much. And that’s because the likelihood that the regulation will be stayed by the D.C. Circuit Court of Appeals is better than not, I believe. And if the rule is stayed, then there will be a great deal more wiggle room for States to act or demur. Below, I briefly explain why I believe why the odds for a stay are strong.

The Court considers four factors to determine whether a stay pending review is warranted:

The likelihood that the moving party will prevail on the merits

The prospect of irreparable injury to the moving party if relief is withheld

The possibility of substantial harm to other parties if relief is granted

The public interest.

Without getting into too much detail, there’s a very cogent case to be made that the Clean Power Plan merits such a stay. Below, I briefly make that case by addressing the four criteria.

The likelihood that the moving party will prevail on the merits
As proposed, the rule suffers from a number of glaring legal defects.

The prospect of irreparable injury to the moving party if relief is withheld
Due to the fact that utilities are capital intensive, they must plan years in advance. As such, utilities and state officials cannot wait for judicial review (a 3 year process, assuming this goes all the way to SCOTUS) to run its course, before they must start complying with the Clean Power Plan’s unprecedented mandate.

The possibility of substantial harm to other parties if relief is granted
The rule would in no way impact global warming, as conceded by EPA Administrator Gina McCarthy. So there’s no actual harm in staying the rule’s implementation.

The public interest.
See responses 1-3

Of course, the legal threshold for achieving a stay pending review of a final agency action is high. There’s no sure thing. Notwithstanding, the case for a stay is strong.

More importantly, I suspect the D.C. Circuit Court of Appeals, the venue in which the rule will be challenged, will be receptive to arguments in favor of delaying the rule’s implementation while it’s reviewed by the court.

For starters, the court already has stayed a major EPA rule with national implications, the Cross State Air Pollution Rule. So this is not terra icognita. It bears noting that the CSAPR was far less consequential and legally dubious than the Clean Power Plan.

More importantly, the court of late has refused to dismiss a novel lawsuit that challenges the Clean Power Plan, even though the regulation is only in the proposal stage of rulemaking. There is little legal precedent for overturning a proposed rule; nonetheless, the court rejected EPA’s motion to dismiss, and is entertaining briefs and oral arguments on the merits. (I explain the suit here and here). IMHO, the court’s willingness to hear out a challenge to the Clean Power Plan, despite the fact that the rule is not yet final, indicates that it is wary of the regulation, as well the court should be.

Of course, any given judicial review would be conducted by a three judge panel selected at random. It’s wholly possible that the preponderance of the court is of a totally different mind than the three judges who are now considering whether to strike down the Clean Power Plan. Only time will tell.

For more on EPA’s authority to impose a Clean Power Plan federal plan, see this three part series: